Everbridge Announces Fourth Quarter and Full Year 2023 Financial Results

BURLINGTON, Mass.--()--Everbridge, Inc. (Nasdaq: EVBG), the global leader in critical event management (CEM) and national public warning solutions, today announced its financial results for the fourth quarter and full year ended December 31, 2023. Revenue for the fourth quarter was down 1% year-over-year to $115.8 million, and GAAP net loss was $(19.3) million, compared to net income of $16.2 million for the fourth quarter of 2022. Revenue for the full year was up 4% year-over-year to $448.8 million, and GAAP net loss was $(47.3) million, compared to $(61.2) million for 2022.

Fourth Quarter 2023 Financial Highlights

  • Total revenue was $115.8 million, a decrease of 1% compared to $117.1 million for the fourth quarter of 2022. Revenue from subscription services was $105.6 million, an increase of 4% compared to $101.4 million for the fourth quarter of 2022. Revenue from professional services, software licenses and other was $10.2 million, a decrease of 35% compared to $15.7 million for the fourth quarter of 2022.
  • GAAP operating loss was $(17.8) million, compared to $(9.7) million for the fourth quarter of 2022.
  • Non-GAAP operating income was $20.7 million, compared to $15.6 million for the fourth quarter of 2022.
  • GAAP net loss was $(19.3) million, compared to GAAP net income of $16.2 million for the fourth quarter of 2022. GAAP diluted net loss per share was $(0.47) based on 41.1 million diluted weighted average common shares outstanding, compared to $(0.15) for the fourth quarter of 2022, based on 45.3 million diluted weighted average common shares outstanding.
  • Non-GAAP net income was $20.2 million, compared to $18.7 million for the fourth quarter of 2022. Non-GAAP diluted net income per share was $0.47, based on 43.4 million diluted weighted average common shares outstanding, compared to $0.41 for the fourth quarter of 2022, based on 45.6 million diluted weighted average common shares outstanding.
  • Adjusted EBITDA was $27.0 million, compared to $20.6 million for the fourth quarter of 2022.
  • Cash flow from operations was an inflow of $29.6 million, compared to $4.4 million for the fourth quarter of 2022.
  • Adjusted for one-time cash payments related to our 2022 Strategic Realignment program, adjusted free cash flow was an inflow of $26.7 million, compared to $4.6 million for the fourth quarter of 2022.
  • Annualized Recurring Revenue (ARR) was $408 million and 55 CEM customers were added during the quarter.
  • Deal metrics: 48 deals over $100,000; 3 deals over $500,000; 1 deal over $1 million.

Full Year 2023 Financial Highlights

  • Total revenue was $448.8 million, an increase of 4% compared to $431.9 million for 2022. Revenue from subscription services was $410.5 million, an increase of 7% compared to $384.6 million for 2022. Revenue from professional services, software licenses and other was $38.3 million, a decrease of 19% compared to $47.3 million for 2022.
  • GAAP operating loss was $(61.4) million, compared to $(84.2) million for 2022.
  • Non-GAAP operating income was $62.1 million, compared to $24.7 million for 2022.
  • GAAP net loss was $(47.3) million, compared to $(61.2) million for 2022. GAAP diluted net loss per share was $(1.31) based on 43.6 million diluted weighted average common shares outstanding, compared to $(1.76) for 2022, based on 45.6 million diluted weighted average common shares outstanding.
  • Non-GAAP net income was $64.7 million compared to $31.9 million for 2022. Non-GAAP diluted net income per share was $1.48, based on 43.8 million diluted weighted average common shares outstanding, compared to $0.70 for 2022, based on 45.9 million diluted weighted average common shares outstanding.
  • Adjusted EBITDA was $84.9 million, compared to $43.1 million for 2022.
  • Cash flow from operations was an inflow of $72.6 million, compared to $20.2 million for 2022.
  • Adjusted for one-time cash payments related to our 2022 Strategic Realignment program, adjusted free cash flow was an inflow of $63.8 million, compared to $13.9 million for 2022.

About Everbridge

Everbridge (Nasdaq: EVBG) empowers enterprises and government organizations to anticipate, mitigate, respond to, and recover stronger from critical events. In today’s unpredictable world, resilient organizations minimize impact to people and operations, absorb stress, and return to productivity faster when deploying critical event management (CEM) technology. Everbridge digitizes organizational resilience by combining intelligent automation with the industry’s most comprehensive risk data to Keep People Safe and Organizations Running™. For more information, visit https://www.everbridge.com/, read the company blog, and follow on LinkedIn. Everbridge… Empowering Resilience.

Key Performance Metric

Annualized Recurring Revenue (ARR) is defined as the expected recurring revenue in the next twelve months from active customer contracts, assuming no increases or reductions in the subscriptions from that cohort of customers. Investors should not place undue reliance on ARR as an indicator of future or expected results. Our presentation of this metric may differ from similarly titled metrics presented by other companies and therefore comparability may be limited.

Non-GAAP Financial Measures

This press release contains the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income/(loss), non-GAAP net income/(loss), non-GAAP net income/(loss) per share, EBITDA, adjusted EBITDA, free cash flow, adjusted free cash flow and adjusted EBITDA margin.

Non-GAAP operating income/(loss) excludes amortization of acquired intangible assets, stock-based compensation, costs related to the 2022 Strategic Realignment, Anvil legal dispute accrual and change in fair value of contingent consideration. Non-GAAP net income/(loss) excludes amortization of acquired intangible assets, stock-based compensation, costs related to the 2022 Strategic Realignment, Anvil legal dispute accrual, change in fair value of contingent consideration, accretion of interest on convertible senior notes, gain (loss) on extinguishment of debt, capped call modification and change in fair value and the tax impact of such adjustments. EBITDA represents net income/(loss) before interest income and interest expense, income tax expense and benefit and depreciation and amortization expense. Adjusted EBITDA represents EBITDA as further adjusted for stock-based compensation expense, costs related to the 2022 Strategic Realignment, Anvil legal dispute accrual, change in fair value of contingent consideration and gain (loss) on extinguishment of debt, capped call modification and change in fair value. Free cash flow represents cash provided by (used in) operating activities minus cash used for capital expenditures and capitalized software development costs. Adjusted free cash flow represents free cash flow as further adjusted for cash payments for the 2022 Strategic Realignment.

We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Everbridge's financial condition and results of operations. We use these non-GAAP measures for financial, operational and budgetary decision-making purposes, to understand and evaluate our core operating performance and trends, and to generate future operating plans. We believe that these non-GAAP financial measures provide useful information regarding past financial performance and future prospects, and permit us to more thoroughly analyze key financial metrics used to make operational decisions. We believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.

We do not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results. We urge investors to review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures, which are included in this press release, and not to rely on any single financial measure to evaluate our business.

Cautionary Language Concerning Forward-Looking Statements

This press release may contain “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are made as of the date of this press release and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond our control. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to: the ability of our products and services to perform as intended and meet our customers’ expectations; our ability to successfully integrate businesses and assets that we may acquire; our ability to attract new customers and retain and increase sales to existing customers; our ability to increase sales of our Mass Notification application and/or ability to increase sales of our other applications; developments in the market for targeted and contextually relevant critical communications or the associated regulatory environment; our estimates of market opportunity and forecasts of market growth may prove to be inaccurate; we have not been profitable on a consistent basis historically and may not achieve or maintain profitability in the future; the lengthy and unpredictable sales cycles for new customers; nature of our business exposes us to inherent liability risks; our ability to attract, integrate and retain qualified personnel; our ability to maintain successful relationships with our channel partners and technology partners; our ability to manage our growth effectively; our ability to respond to competitive pressures; potential liability related to privacy and security of personally identifiable information; our ability to protect our intellectual property rights, and the other risks detailed in our risk factors discussed in filings with the U.S. Securities and Exchange Commission (SEC), including but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2023, which we expect to file with the SEC on or before February 29, 2024 and other subsequent filings with the SEC. The forward-looking statements included in this press release represent our views as of the date of this press release. We undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

All Everbridge products are trademarks of Everbridge, Inc. in the USA and other countries. All other product or company names mentioned are the property of their respective owners.

 

Consolidated Balance Sheets

(in thousands)

(unaudited)

 

 

December 31,

 

 

2023

 

 

2022

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

$

122,440

 

 

$

198,725

 

Restricted cash

 

2,120

 

 

 

2,046

 

Accounts receivable, net

 

119,389

 

 

 

119,986

 

Prepaid expenses

 

12,880

 

 

 

13,133

 

Assets held for sale

 

 

 

 

6,485

 

Deferred costs and other current assets

 

36,604

 

 

 

31,866

 

Total current assets

 

293,433

 

 

 

372,241

 

Property and equipment, net

 

8,305

 

 

 

8,993

 

Capitalized software development costs, net

 

31,630

 

 

 

27,370

 

Goodwill

 

517,184

 

 

 

508,781

 

Intangible assets, net

 

130,264

 

 

 

166,177

 

Restricted cash

 

811

 

 

 

823

 

Prepaid expenses

 

902

 

 

 

1,709

 

Deferred costs and other assets

 

43,356

 

 

 

39,570

 

Total assets

$

1,025,885

 

 

$

1,125,664

 

Current liabilities:

 

 

 

 

 

Accounts payable

$

15,013

 

 

$

10,854

 

Accrued payroll and employee related liabilities

 

32,824

 

 

 

31,175

 

Accrued expenses

 

36,346

 

 

 

13,566

 

Deferred revenue

 

242,789

 

 

 

233,106

 

Convertible senior notes, current

 

63,110

 

 

 

 

Liabilities held for sale

 

 

 

 

2,062

 

Other current liabilities

 

8,918

 

 

 

10,644

 

Total current liabilities

 

399,000

 

 

 

301,407

 

Long-term liabilities:

 

 

 

 

 

Deferred revenue, noncurrent

 

6,429

 

 

 

9,278

 

Convertible senior notes, noncurrent

 

296,561

 

 

 

500,298

 

Deferred tax liabilities

 

4,318

 

 

 

6,236

 

Other long-term liabilities

 

17,268

 

 

 

19,334

 

Total liabilities

 

723,576

 

 

 

836,553

 

Stockholders' equity:

 

 

 

 

 

Common stock

 

41

 

 

 

40

 

Additional paid-in capital

 

771,779

 

 

 

721,143

 

Accumulated deficit

 

(449,429

)

 

 

(402,124

)

Accumulated other comprehensive loss

 

(20,082

)

 

 

(29,948

)

Total stockholders' equity

 

302,309

 

 

 

289,111

 

Total liabilities and stockholders' equity

$

1,025,885

 

 

$

1,125,664

 

 

Consolidated Statements of Operations and Comprehensive Income (Loss)

(in thousands, except share and per share data)

(unaudited)

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Revenue

$

115,760

 

 

$

117,130

 

 

$

448,788

 

 

$

431,892

 

Cost of revenue

 

33,346

 

 

 

34,391

 

 

 

131,487

 

 

 

134,934

 

Gross profit

 

82,414

 

 

 

82,739

 

 

 

317,301

 

 

 

296,958

 

Gross margin

 

71.19

%

 

 

70.64

%

 

 

70.70

%

 

 

68.76

%

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing

 

37,536

 

 

 

39,866

 

 

 

159,092

 

 

 

173,621

 

Research and development

 

21,999

 

 

 

20,631

 

 

 

95,468

 

 

 

95,986

 

General and administrative

 

39,886

 

 

 

26,579

 

 

 

120,519

 

 

 

99,365

 

Restructuring

 

827

 

 

 

5,390

 

 

 

3,621

 

 

 

12,169

 

Total operating expenses

 

100,248

 

 

 

92,466

 

 

 

378,700

 

 

 

381,141

 

Operating loss

 

(17,834

)

 

 

(9,727

)

 

 

(61,399

)

 

 

(84,183

)

Other income, net

 

 

 

 

 

 

 

 

 

 

 

Interest and investment income

 

958

 

 

 

2,902

 

 

 

7,120

 

 

 

5,697

 

Interest expense

 

(538

)

 

 

(1,187

)

 

 

(2,796

)

 

 

(5,106

)

Gain on extinguishment of convertible notes, capped call modification and change in fair value

 

 

 

 

24,013

 

 

 

12,658

 

 

 

19,243

 

Other income (expense), net

 

647

 

 

 

(484

)

 

 

820

 

 

 

777

 

Total other income, net

 

1,067

 

 

 

25,244

 

 

 

17,802

 

 

 

20,611

 

Income (loss) before income taxes

 

(16,767

)

 

 

15,517

 

 

 

(43,597

)

 

 

(63,572

)

(Provision for) benefit from income taxes

 

(2,523

)

 

 

644

 

 

 

(3,708

)

 

 

2,398

 

Net income (loss)

$

(19,290

)

 

$

16,161

 

 

$

(47,305

)

 

$

(61,174

)

Net income (loss) per share attributable to common stockholders:

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(0.47

)

 

$

0.40

 

 

$

(1.16

)

 

$

(1.54

)

Diluted

$

(0.47

)

 

$

(0.15

)

 

$

(1.31

)

 

$

(1.76

)

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

41,055,293

 

 

 

39,967,553

 

 

 

40,668,327

 

 

 

39,680,440

 

Diluted

 

41,055,293

 

 

 

45,338,189

 

 

 

43,622,341

 

 

 

45,583,459

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

12,905

 

 

 

21,378

 

 

 

9,866

 

 

 

(27,046

)

Total comprehensive income (loss)

$

(6,385

)

 

$

37,539

 

 

$

(37,439

)

 

$

(88,220

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense included in the above:

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Cost of revenue

$

1,414

 

 

$

1,192

 

 

$

6,171

 

 

$

5,468

 

Sales and marketing

 

3,967

 

 

 

1,597

 

 

 

17,313

 

 

 

15,917

 

Research and development

 

1,919

 

 

 

600

 

 

 

12,225

 

 

 

9,967

 

General and administrative

 

3,412

 

 

 

4,529

 

 

 

13,180

 

 

 

16,268

 

Total stock-based compensation

$

10,712

 

 

$

7,918

 

 

$

48,889

 

 

$

47,620

 

 

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

(19,290

)

 

$

16,161

 

 

$

(47,305

)

 

$

(61,174

)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

14,527

 

 

 

15,347

 

 

 

58,815

 

 

 

60,600

 

Amortization of deferred costs

 

5,090

 

 

 

4,886

 

 

 

19,568

 

 

 

18,251

 

Deferred income taxes

 

(875

)

 

 

1,949

 

 

 

(1,912

)

 

 

(5,183

)

Accretion of interest on convertible senior notes

 

518

 

 

 

1,069

 

 

 

2,640

 

 

 

4,561

 

(Gain) loss on disposal of assets

 

(356

)

 

 

(213

)

 

 

(708

)

 

 

727

 

Gain on extinguishment of convertible notes, capped call modification and change in fair value

 

 

 

 

(24,013

)

 

 

(12,658

)

 

 

(19,243

)

Provision for (benefit from) credit losses and sales reserve

 

(202

)

 

 

1,122

 

 

 

2,001

 

 

 

410

 

Stock-based compensation

 

10,712

 

 

 

7,918

 

 

 

48,889

 

 

 

47,620

 

Other non-cash adjustments

 

 

 

 

 

 

 

 

 

 

(57

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

(26,503

)

 

 

(29,608

)

 

 

(1,064

)

 

 

(848

)

Prepaid expenses

 

2,551

 

 

 

543

 

 

 

984

 

 

 

560

 

Deferred costs

 

(9,747

)

 

 

(6,906

)

 

 

(28,562

)

 

 

(23,063

)

Other assets

 

3,027

 

 

 

(11,118

)

 

 

947

 

 

 

(3,527

)

Accounts payable

 

2,251

 

 

 

(1,683

)

 

 

4,187

 

 

 

(4,855

)

Accrued payroll and employee related liabilities

 

7,752

 

 

 

2,783

 

 

 

1,649

 

 

 

(4,136

)

Accrued expenses

 

19,602

 

 

 

1,629

 

 

 

21,741

 

 

 

992

 

Deferred revenue

 

18,763

 

 

 

13,424

 

 

 

6,878

 

 

 

8,746

 

Other liabilities

 

1,801

 

 

 

11,064

 

 

 

(3,515

)

 

 

(214

)

Net cash provided by operating activities

 

29,621

 

 

 

4,354

 

 

 

72,575

 

 

 

20,167

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

(1,093

)

 

 

(511

)

 

 

(5,217

)

 

 

(3,462

)

Proceeds from landlord reimbursement

 

 

 

 

 

 

 

88

 

 

 

1,219

 

Proceeds from sale of assets

 

 

 

 

 

 

 

4,368

 

 

 

 

Payment for acquisition of business, net of acquired cash

 

 

 

 

(336

)

 

 

 

 

 

(1,585

)

Additions to capitalized software development costs

 

(3,836

)

 

 

(3,456

)

 

 

(16,540

)

 

 

(15,065

)

Net cash used in investing activities

 

(4,929

)

 

 

(4,303

)

 

 

(17,301

)

 

 

(18,893

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

Repurchase of convertible notes

 

 

 

 

(288,761

)

 

 

(129,579

)

 

 

(288,761

)

Proceeds from termination of convertible notes capped call hedge

 

33

 

 

 

1,312

 

 

 

33

 

 

 

1,312

 

Payments associated with shares withheld to settle employee tax withholding liability

 

(1,666

)

 

 

(2,098

)

 

 

(7,885

)

 

 

(6,307

)

Proceeds from employee stock purchase plan

 

 

 

 

 

 

 

4,291

 

 

 

3,165

 

Proceeds from stock option exercises

 

19

 

 

 

45

 

 

 

1,319

 

 

 

144

 

Other

 

(21

)

 

 

(19

)

 

 

(77

)

 

 

(73

)

Net cash used in financing activities

 

(1,635

)

 

 

(289,521

)

 

 

(131,898

)

 

 

(290,520

)

Effect of exchange rates on cash, cash equivalents and restricted cash

 

1,767

 

 

 

1,391

 

 

 

401

 

 

 

(1,918

)

Net increase (decrease) in cash, cash equivalents and restricted cash

 

24,824

 

 

 

(288,079

)

 

 

(76,223

)

 

 

(291,164

)

Cash, cash equivalents and restricted cash—beginning of period

 

100,547

 

 

 

489,673

 

 

 

201,594

 

 

 

492,758

 

Cash, cash equivalents and restricted cash—end of period

$

125,371

 

 

$

201,594

 

 

$

125,371

 

 

$

201,594

 

 

Reconciliation of GAAP measures to non-GAAP measures

(unaudited)

 

The following table reconciles our GAAP gross profit to non-GAAP gross profit (in thousands):

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Gross profit

$

82,414

 

 

$

82,739

 

 

$

317,301

 

 

$

296,958

 

Amortization of acquired intangibles

 

1,915

 

 

 

2,602

 

 

 

8,445

 

 

 

11,657

 

Stock-based compensation

 

1,414

 

 

 

1,192

 

 

 

6,171

 

 

 

5,468

 

2022 Strategic Realignment

 

24

 

 

 

259

 

 

 

814

 

 

 

953

 

Non-GAAP gross profit

$

85,767

 

 

$

86,792

 

 

$

332,731

 

 

$

315,036

 

The following table reconciles our GAAP gross margin to non-GAAP gross margin(1):

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Gross margin

 

71.2

%

 

 

70.6

%

 

 

70.7

%

 

 

68.8

%

Amortization of acquired intangibles margin

 

1.7

%

 

 

2.2

%

 

 

1.9

%

 

 

2.7

%

Stock-based compensation margin

 

1.2

%

 

 

1.0

%

 

 

1.4

%

 

 

1.3

%

2022 Strategic Realignment margin

 

0.0

%

 

 

0.2

%

 

 

0.2

%

 

 

0.2

%

Non-GAAP gross margin

 

74.1

%

 

 

74.1

%

 

 

74.1

%

 

 

72.9

%

(1) Columns may not add up due to rounding.

The following table reconciles our GAAP operating loss to non-GAAP operating income. For comparability purposes, non-GAAP operating income results have been recast for the three and twelve months ended December 31, 2022 to include costs related to the Anvil legal dispute to conform to the current year presentation (in thousands):

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Operating loss

$

(17,834

)

 

$

(9,727

)

 

$

(61,399

)

 

$

(84,183

)

Amortization of acquired intangibles

 

8,852

 

 

 

9,854

 

 

 

36,840

 

 

 

42,982

 

Stock-based compensation

 

10,712

 

 

 

7,918

 

 

 

48,889

 

 

 

47,620

 

2022 Strategic Realignment

 

3,015

 

 

 

6,539

 

 

 

13,751

 

 

 

17,357

 

Anvil legal dispute accrual

 

15,936

 

 

 

1,000

 

 

 

24,000

 

 

 

1,000

 

Change in fair value of contingent consideration

 

 

 

 

 

 

 

 

 

 

(57

)

Non-GAAP operating income

$

20,681

 

 

$

15,584

 

 

$

62,081

 

 

$

24,719

 

The following table reconciles our GAAP net income (loss) to non-GAAP net income. For comparability purposes, non-GAAP net income results have been recast for the three and twelve months ended December 31, 2022 to include costs related to the Anvil legal dispute to conform to the current year presentation (in thousands):

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net income (loss)

$

(19,290

)

 

$

16,161

 

 

$

(47,305

)

 

$

(61,174

)

Amortization of acquired intangibles

 

8,852

 

 

 

9,854

 

 

 

36,840

 

 

 

42,982

 

Stock-based compensation

 

10,712

 

 

 

7,918

 

 

 

48,889

 

 

 

47,620

 

2022 Strategic Realignment

 

3,015

 

 

 

6,537

 

 

 

13,733

 

 

 

17,358

 

Anvil legal dispute accrual

 

15,936

 

 

 

1,000

 

 

 

24,000

 

 

 

1,000

 

Change in fair value of contingent consideration

 

 

 

 

 

 

 

 

 

 

(57

)

Accretion of interest on convertible senior notes

 

518

 

 

 

1,069

 

 

 

2,640

 

 

 

4,561

 

Gain on extinguishment of convertible notes, capped call modification and change in fair value

 

 

 

 

(24,013

)

 

 

(12,658

)

 

 

(19,243

)

Income tax adjustments

 

491

 

 

 

170

 

 

 

(1,427

)

 

 

(1,151

)

Non-GAAP net income

$

20,234

 

 

$

18,696

 

 

$

64,712

 

 

$

31,896

 

Reconciliation of GAAP measures to non-GAAP measures (Continued)

(unaudited)

 

The following table reconciles our GAAP net income (loss) per basic share to non-GAAP net income per basic share. For comparability purposes, non-GAAP net income per basic share results have been recast for the three and twelve months ended December 31, 2022 to include costs related to the Anvil legal dispute to conform to the current year presentation(1):

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net income (loss) per basic share⁽ᵃ⁾

$

(0.47

)

 

$

0.40

 

 

$

(1.16

)

 

$

(1.54

)

Amortization of acquired intangibles per basic share⁽ᵇ⁾

 

0.22

 

 

 

0.25

 

 

 

0.91

 

 

 

1.08

 

Stock-based compensation per basic share⁽ᵇ⁾

 

0.26

 

 

 

0.20

 

 

 

1.20

 

 

 

1.20

 

2022 Strategic Realignment per basic share⁽ᵇ⁾

 

0.07

 

 

 

0.16

 

 

 

0.34

 

 

 

0.44

 

Anvil legal dispute accrual per basic share⁽ᵇ⁾

 

0.39

 

 

 

0.03

 

 

 

0.59

 

 

 

0.03

 

Change in fair value of contingent consideration per basic share⁽ᵇ⁾

 

 

 

 

 

 

 

 

 

 

 

Accretion of interest on convertible senior notes per basic share⁽ᵇ⁾

 

0.01

 

 

 

0.03

 

 

 

0.06

 

 

 

0.11

 

Gain on extinguishment of convertible notes, capped call modification and change in fair value per basic share⁽ᵇ⁾

 

 

 

 

(0.60

)

 

 

(0.31

)

 

 

(0.48

)

Income tax adjustments per basic share⁽ᵇ⁾

 

0.01

 

 

 

 

 

 

(0.04

)

 

 

(0.03

)

Non-GAAP net income per basic share⁽ᵇ⁾

$

0.49

 

 

$

0.47

 

 

$

1.59

 

 

$

0.80

 

(1) Amounts may not add up due to rounding.

The following table reconciles our GAAP net loss per diluted share to non-GAAP net income per diluted share. For comparability purposes, non-GAAP net income per diluted share results have been recast for the three and twelve months ended December 31, 2022 to include costs related to the Anvil legal dispute to conform to the current year presentation(1):

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net loss per diluted share⁽ᵃ⁾

$

(0.47

)

 

$

(0.15

)

 

$

(1.31

)

 

$

(1.76

)

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of acquired intangibles per diluted share⁽ᵇ⁾

 

0.20

 

 

 

0.22

 

 

 

0.84

 

 

 

0.94

 

Stock-based compensation per diluted share⁽ᵇ⁾

 

0.25

 

 

 

0.17

 

 

 

1.12

 

 

 

1.04

 

2022 Strategic Realignment per diluted share⁽ᵇ⁾

 

0.07

 

 

 

0.14

 

 

 

0.31

 

 

 

0.38

 

Anvil legal dispute accrual per diluted share⁽ᵇ⁾

 

0.37

 

 

 

0.02

 

 

 

0.55

 

 

 

0.02

 

Change in fair value of contingent consideration per diluted share⁽ᵇ⁾

 

 

 

 

 

 

 

 

 

 

 

Accretion of interest on convertible senior notes per diluted share⁽ᵇ⁾

 

0.01

 

 

 

0.02

 

 

 

0.06

 

 

 

0.10

 

Gain on extinguishment of convertible notes, capped call modification and change in fair value per diluted share⁽ᵇ⁾

 

 

 

 

(0.53

)

 

 

(0.29

)

 

 

(0.42

)

Income tax adjustments per diluted share⁽ᵇ⁾

 

0.01

 

 

 

 

 

 

(0.03

)

 

 

(0.03

)

Non-GAAP net income per diluted share⁽ᵇ⁾

$

0.47

 

 

$

0.41

 

 

$

1.48

 

 

$

0.70

 

(1) Amounts may not add up due to differences in GAAP and non-GAAP net income (loss) and diluted shares.

(a) GAAP weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

41,055,293

 

 

 

39,967,553

 

 

 

40,668,327

 

 

 

39,680,440

 

Diluted

 

41,055,293

 

 

 

45,338,189

 

 

 

43,622,341

 

 

 

45,583,459

 

(b) Non-GAAP weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

41,055,293

 

 

 

39,967,553

 

 

 

40,668,327

 

 

 

39,680,440

 

Diluted

 

43,355,513

 

 

 

45,592,690

 

 

 

43,770,884

 

 

 

45,867,120

 

GAAP and Non-GAAP diluted weighted-average shares include dilutive potential common shares related to convertible notes and stock-based compensation grants.

Reconciliation of GAAP measures to non-GAAP measures (Continued)

(unaudited)

 

The following tables reconcile our net income (loss) to EBITDA and adjusted EBITDA, net cash provided by operating activities to free cash flow and adjusted free cash flow and net income (loss) margin to EBITDA margin and adjusted EBITDA margin. For comparability purposes, adjusted EBITDA and adjusted EBITDA margin results have been recast for the three and twelve months ended December 31, 2022 to include costs related to the Anvil legal dispute and to conform to the current year presentation (dollars in thousands):

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net income (loss)

$

(19,290

)

 

$

16,161

 

 

$

(47,305

)

 

$

(61,174

)

Interest and investment expense, net

 

(420

)

 

 

(1,715

)

 

 

(4,324

)

 

 

(591

)

Provision for (benefit from) income taxes

 

2,523

 

 

 

(644

)

 

 

3,708

 

 

 

(2,398

)

Depreciation and amortization

 

14,527

 

 

 

15,347

 

 

 

58,815

 

 

 

60,600

 

EBITDA

 

(2,660

)

 

 

29,149

 

 

 

10,894

 

 

 

(3,563

)

Stock-based compensation

 

10,712

 

 

 

7,918

 

 

 

48,889

 

 

 

47,620

 

2022 Strategic Realignment

 

3,015

 

 

 

6,537

 

 

 

13,733

 

 

 

17,358

 

Anvil legal dispute accrual

 

15,936

 

 

 

1,000

 

 

 

24,000

 

 

 

1,000

 

Change in fair value of contingent consideration

 

 

 

 

 

 

 

 

 

 

(57

)

Gain on extinguishment of convertible notes, capped call modification and change in fair value

 

 

 

 

(24,013

)

 

 

(12,658

)

 

 

(19,243

)

Adjusted EBITDA

$

27,003

 

 

$

20,591

 

 

$

84,858

 

 

$

43,115

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by operating activities

$

29,621

 

 

$

4,354

 

 

$

72,575

 

 

$

20,167

 

Capital expenditures

 

(1,093

)

 

 

(511

)

 

 

(5,217

)

 

 

(3,462

)

Capitalized software development costs

 

(3,836

)

 

 

(3,456

)

 

 

(16,540

)

 

 

(15,065

)

Free cash flow

 

24,692

 

 

 

387

 

 

 

50,818

 

 

 

1,640

 

Cash payments for 2022 Strategic Realignment

 

1,989

 

 

 

4,187

 

 

 

12,940

 

 

 

12,266

 

Adjusted free cash flow

$

26,681

 

 

$

4,574

 

 

$

63,758

 

 

$

13,906

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) margin

 

(16.7

)%

 

 

13.8

%

 

 

(10.5

)%

 

 

(14.2

)%

Interest and investment expense, net margin

 

(0.4

)%

 

 

(1.5

)%

 

 

(1.0

)%

 

 

(0.1

)%

Provision for (benefit from) income taxes margin

 

2.2

%

 

 

(0.5

)%

 

 

0.8

%

 

 

(0.6

)%

Depreciation and amortization margin

 

12.5

%

 

 

13.1

%

 

 

13.1

%

 

 

14.0

%

EBITDA margin

 

(2.3

)%

 

 

24.9

%

 

 

2.4

%

 

 

(0.8

)%

Stock-based compensation margin

 

9.3

%

 

 

6.8

%

 

 

10.9

%

 

 

11.0

%

2022 Strategic Realignment margin

 

2.6

%

 

 

5.6

%

 

 

3.1

%

 

 

4.0

%

Anvil legal dispute accrual margin

 

13.8

%

 

 

0.9

%

 

 

5.3

%

 

 

0.2

%

Change in fair value of contingent consideration margin

 

 

 

 

 

 

 

 

 

 

 

Gain on extinguishment of convertible notes, capped call modification and change in fair value margin

 

 

 

 

(20.5

)%

 

 

(2.8

)%

 

 

(4.5

)%

Adjusted EBITDA margin

 

23.3

%

 

 

17.6

%

 

 

18.9

%

 

 

10.0

%

(margin % columns may not add up due to rounding)

 

 

 

 

 

 

 

 

 

 

 

Remaining Performance Obligations as of December 31, 2023
(in millions)

 

Remaining Performance Obligations

 

 

Remaining Performance Obligations
Next Twelve Months

 

Subscription and other contracts

$

494

 

 

$

305

 

Professional services contracts

 

10

 

 

 

9

 

Reconciliation of Basic and Diluted Net Income (Loss) per Share

 

The following table summarizes the computations of basic net income (loss) per share and diluted net loss per share (in thousands, except share and per share data):

 

 

Three Months Ended

 

 

Twelve Months Ended

 

 

December 31,

 

 

December 31,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net income (loss)

$

(19,290

)

 

$

16,161

 

 

$

(47,305

)

 

$

(61,174

)

Dilutive effect of convertible notes, net of tax

 

 

 

 

(22,804

)

 

 

(9,682

)

 

 

(18,890

)

Adjusted net loss

$

(19,290

)

 

$

(6,643

)

 

$

(56,987

)

 

$

(80,064

)

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common stock outstanding — basic

 

41,055,293

 

 

 

39,967,553

 

 

 

40,668,327

 

 

 

39,680,440

 

Dilutive potential common shares related to convertible notes

 

 

 

 

5,370,636

 

 

 

2,954,014

 

 

 

5,903,019

 

Weighted-average common stock outstanding — diluted

 

41,055,293

 

 

 

45,338,189

 

 

 

43,622,341

 

 

 

45,583,459

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income (loss) per share

$

(0.47

)

 

$

0.40

 

 

$

(1.16

)

 

$

(1.54

)

Diluted net loss per share

$

(0.47

)

 

$

(0.15

)

 

$

(1.31

)

 

$

(1.76

)

 

Contacts

Everbridge:

Investors:
Nandan Amladi
Investor Relations
nandan.amladi@everbridge.com
617-665-7197

Media:
Jeff Young
Media Relations
jeff.young@everbridge.com
781-859-4116

Contacts

Everbridge:

Investors:
Nandan Amladi
Investor Relations
nandan.amladi@everbridge.com
617-665-7197

Media:
Jeff Young
Media Relations
jeff.young@everbridge.com
781-859-4116